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Article Excerpt
Establishing and communicating corporate travel policy is vital to creating and maintaining an effective travel program. A successful travel policy--which can and should result in substantial savings and higher service levels--provides clear direction for traveling employees. The policy should steer travelers to use specific travel suppliers and classes of service, include details on particular booking practices and explain why the company has adopted the specific procedures: to ensure that supplier commitments are met and superfluous spending is minimized.
While policies for mature travel programs increasingly are becoming more comprehensive and strict--with many companies explicitly defining penalties for those who do not comply--travel managers just beginning to put together their programs may want to start with the basics.
"As the company gets accustomed to the initial policies, it becomes much easier to add and tweak the policy as a whole," according to Robin Buzzeo, director of corporate travel for Taro Pharmaceuticals in Hawthorne, N.Y. She suggested concentrating first on areas where you know you can get compliance. "You may not be able to get everybody to use the corporate charge card, but using the same agency or airline/hotel/car rental might be possible. Get the most cost-efficient areas addressed and build from that." Plus, she said, "If it's a really long policy, the danger is nobody reads it."
However, Buzzeo said, building into the policy strict mechanisms to fend off noncompliance should be a priority for big, small, old and new travel programs. "You can 'encourage' but if you don't get compliance, you might as well throw the paper out," she said. "You need to set the parameters, and the parameters need to be adhered to."
Companies that put in place a strong, measurable policy can reduce unnecessary spending; prove their ability to move marketshare and gain negotiating leverage with suppliers; help travelers accomplish their missions by putting in place structures and procedures to save time and effort while providing them with an acceptable level of safety, service and comfort; and enhance overall travel process productivity, from planning through submitting an expense report.
Veteran travel professionals stress the need to review and reissue the travel policy at least once a year to address new corporate procedures or industry changes, including such timely issues as security, concerns about travelers' use of low-cost carriers and Internet purchasing, as well as the Sarbanes-Oxley Act of 2002.
Because "the climate of the industry changes on a daily basis," Buzzeo said, the policy should be reviewed at least once a year. "It's a formidable task, but if you just focus on the issues that have changed in the industry or your company, then you may not need to go through the entire policy." For example, Buzzeo noted, Taro recently had to address proper security for laptops. "With the way Wi-Fi has proliferated, who's not carrying around a laptop?" she said. "The security of the laptop is very important. It's not just losing the laptop, because we're insured. It's the proprietary information that's contained on that laptop.
"Security in general remains a big issue," Buzzeo continued, "and also a way we get a lot more policy compliance. We tell travelers, 'In the post-9/11 world, we need to know where you are so at any given time we can locate you. We can't help you if you don't book through us and we don't know where you are.' It helps us and also shows the travelers that we're not trying to be Big Brother, but that 'we want to be able to help you and your families.' Most travelers understand that reasoning more than if you tell them, 'You have to.'"
Particularly in today's age of Internet travel sites, many of which have tremendous brand recognition among travelers, travel managers need to be clear about the consequences to the company if travelers go outside of policy and use those travel sites. Some companies also have strengthened requirements for pre-trip approval processes and/or mandated travel agency usage to foster better employee tracking.
While Buzzeo believes that "as borders fall, so should the differentiation with travel regulations for each country," some corporate cultures simply are not conducive to issuing strict travel policies. Still, the issues of traveler security, safety and tracking continue to be important concerns, requiring that all bookings be conducted through the company's designated agency or online booking tool.
Regarding the new Sarbanes-Oxley regulations, if the corporate travel policy does not yet assist your company in establishing concise and measurable business travel practices that can support Sarbanes-Oxley, travel managers must begin to tackle that task. Experienced travel managers may need only to look at personal usage, but buyers who are just beginning to build their programs must take a hard look at how Sarbanes-Oxley may affect travel processes. Sarbanes-Oxley could give them the occasion to question any policy that affects the department and reconsider those practices or make necessary improvements, whether they be internal or external.
A policy development process that addresses many or all of the elements outlined below should provide a solid foundation for travel policies that fit your company.
I. QUESTIONS TO ANSWER
A. Who should write and update the travel policy?
1. One person, such as a travel manager, who has extensive knowledge of the travel industry or world regions should draft the document. Although this individual should be the sole publisher of the document, collaboration from various entities in the company will guarantee buy-in and support of its usage. The travel manager should use all avenues of benchmarking, i.e., peer groups, travel management companies and industry-related consultants, which can provide perspective on accepted industry standards
2. A committee of people from various departments within the company: accounting, administration, finance, HR, strategic sourcing, sales and marketing and any department with a high frequency of travel. The committee should make recommendations to a policy writer for implementation. The travel committee should seek input from travelers, who can help interpret the impact of policy decisions.
3. A high-ranking executive: a key department head, the CFO or CEO. It is always helpful to include a letter of support from the CFO/CEO when you communicate policy.
4. Different people at different sites or divisions: For global policies, having reps from all of the countries involved often helps win support and improves compliance.
5. A combination of the above: At many companies, the travel manager writes the policy for approval by a committee and senior management.
B. Who should be subject to the policy?
1. Employees at headquarters or whichever location is issuing the policy only. This is easiest to administer.
2. Employees at any domestic location, division or branch. This offers greater cost control, but could interfere with autonomy for individual units and locations.
3. All employees, including those overseas. This choice should take into consideration that travel expenses are more difficult to track overseas, and differences in international laws and cultures could make it impractical or inadvisable to mandate adherence to various policies. It may not be feasible to get every country into the policy parameters.
4. The policy...
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